DOJ increasingly investigating health systems, claiming anticompetitive contracts

With patients in the US increasingly concerned about the cost of healthcare, the Department of Justice (DOJ) is taking on more health systems for allegedly engaging in anticompetitive practices that can lead to higher prices for care.

The DOJ has filed antitrust suits against two hospital systems so far in 2026—Columbus-based OhioHealth and New York City-based NewYork-Presbyterian—claiming both had been using their market power to negotiate payer contracts that raised healthcare costs for patients.

On March 26, the DOJ announced its lawsuit against NewYork-Presbyterian, alleging the health system was preventing payers from offering health plans that didn’t either include its facilities or put them in favored tiers.

“NewYork-Presbyterian even forbids payers from offering lower copays when patients chose to receive care at NewYork-Presbyterian’s—often lower-priced—rivals,” the DOJ press release stated, adding that the system’s actions limit competition and don’t allow patients to choose more affordable plans.

Angela Karafazli, a spokesperson for NewYork-Presbyterian, said in a statement that the health system believes the lawsuit is “without merit.”

“We stand behind our policies and processes, which we believe are pro-competitive,” Karafazli said.

A month earlier, the DOJ announced its lawsuit against OhioHealth that claimed the health system was forcing payers to include its facilities in all of their networks despite other systems offering lower prices.

“OhioHealth has been cooperating with the Department of Justice throughout its review of our managed care agreements,” system spokesperson Colin Yoder said in a statement to Healthcare Brew. “We are confident in our position and remain committed to full compliance with all applicable laws and regulatory requirements.”

Acting Assistant Attorney General Omeed Assefi told Healthcare Brew the department is taking a “zero-tolerance policy” against anticompetitive practices such as those alleged in the lawsuits.

Looking back. These types of antitrust lawsuits against health systems aren’t unprecedented, Yashaswini Singh, assistant professor of health services, policy, and practice at Brown University, told Healthcare Brew.

In 2018, North Carolina-based Atrium Health settled with the DOJ over claims it had restricted payers’ ability to guide patients to lower-cost health systems. And in 2021, Sacramento-based Sutter Health paid $575 million to settle a suit brought by the California attorney general alleging anticompetitive business practices. The same health system agreed to pay a $228.5 million settlement last year in response to a federal suit claiming it had used its market power to raise insurance premiums.

“Across these lawsuits spanning a decade now, the common themes are that…competition can be reduced in healthcare markets, not just through mergers and acquisitions, but through the exercise of market power, which manifests in these restrictive contract terms between hospitals and insurers,” Singh said.

While it’s not clear why the DOJ is focusing on these specific health systems, Singh said each is dominant in their local markets, so they have the power to negotiate restrictive contracts.

The bigger picture. Health systems are able to negotiate such contracts due to consolidation, Singh said.

In 47% of metropolitan areas in 2024, just one or two health systems controlled the entire inpatient hospital market, health policy research firm KFF found. Consolidation has risen significantly in the last decade, with about 80% of metropolitan healthcare markets becoming less competitive or controlled by just one hospital system between 2015 and 2024, according to KFF data.

“What that means, practically, is that if you are an insurer trying to negotiate with hospitals in a given region, there might only be a handful of facilities that are not affiliated with this dominant entity that you can contract with,” Singh said.

That leads to something called “all-or-nothing contracting,” in which the dominant health system tells an insurer that if it wants to contract with any of its hospitals or clinics, it has to contract with all of them, she explained.

“If an insurer doesn’t have a viable alternate choice to turn to—to contract with—it will have no choice but to give in to that term,” Singh added.

Since the federal government has been paying attention to anticompetitive contracting between hospitals and payers, Singh said if she were working at a health system, she would probably be “taking a closer look at my contracts just to make sure…there’s nothing in there that amounts to this kind of restrictive, anticompetitive practice.”